In Hussain v Nottinghamshire Healthcare NHS Trust, during the course of the Liability Hearing, the ET gave Hussain (H) a costs warning, urging him to focus on “whether certain of his claims now had any prospect of success” and whether his claim was “so very weak having come apart in cross examination and by reference to the contemporaneous documentation and also his answers”. The ET went on to dismiss all of H’s claims and made observations adverse to him as to the merit of his claims and his credibility, i.e. that he had pursued “extremely serious allegations which are false”.

The employer made a costs application, for £94,156.96, on the basis that H had acted unreasonably in the bringing of the proceedings. The tribunal agreed, finding that H had behaved “otherwise unreasonably”, certainly in pursuing the proceedings “at latest from the first costs warning” made by the employer in correspondence, and in respect of all but his complaint of unfair dismissal. After assessing H’s means, the ET awarded 85% of the £94,156.96 spent by the employer, i.e. £80,033, the 15% reduction relating to the costs the ET considered would have been incurred in hearing the unfair dismissal claim. H appealed arguing that the ET had been biased and the reasons given for the costs award were inadequate.

The EAT held this was not a case where the ET impermissibly stepped over the line.  An ET must be able to give guidance to parties as to how their case or conduct might be viewed and the risks they might be taking if they continue down a particular path.  In certain circumstances, not to do so could itself be considered a failure to try to ensure a level playing field.  The EAT also confirmed, however, that while the ET had been entitled to make the costs award it would need to clarify its approach as to whether its decision was based on costs incurred by the employer after the first costs warning or to all its costs.

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